Vanguard’s Bitcoin Bet: When Passive Investing Gets a Little Too Active 😂

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In a plot twist that’s got me reaching for the popcorn, Vanguard, the $10 trillion asset manager, has quietly become the top shareholder in Strategy (MSTR). Yes, you read that right. The same Vanguard that once warned us Bitcoin was “immature” and had “no inherent economic value” is now sitting on 20 million MSTR shares, which is nearly 8% of Strategy’s Class A stock. Talk about a 180! 🤯

Index Strategy At Work

According to Bloomberg, Vanguard didn’t exactly plan this. They’re just following their index-fund rules. When Strategy’s stock started climbing, it naturally grew larger in the indexes Vanguard tracks. So, Vanguard had no choice but to buy more shares. It’s like when you’re on a diet, but the buffet keeps bringing you more cake. 🍰

Through its broad-market funds, Vanguard ended up with a stake worth hundreds of millions of dollars. This just goes to show how passive strategies can sometimes lead to some pretty active positions in unexpected places. Who knew following the rules could be so… exciting? 🎉

Vanguard’s CEO Tim Buckley once said that Bitcoin “could wreak havoc on portfolios.” He argued that the crypto lacked the history and solid ground that long-term investors need. But hey, when the market decides to throw you a curveball, you’ve got to play the game, right? 🏏

Indirect Bitcoin Exposure Grows

Strategy now holds 601,550 BTC. Each share of MSTR represents a slice of that giant pile of Bitcoin. So, for anyone holding Vanguard’s indexes, that means you’re indirectly holding more than half a million coins. It’s like being a part of a secret Bitcoin club without even knowing it! 🤫

Since 2020, MSTR stock has climbed around 3,400%. That surge helped push the firm’s market value up fast enough to land in Vanguard’s top holdings. It’s like Strategy went from being a small fish to a whale in the sea of investments. 🐳

Large investors often use ETFs or purpose-built products to get Bitcoin exposure. Vanguard could have joined the likes of BlackRock in launching a spot Bitcoin ETF. But nope, they decided to stick to their index strategy. Instead, they find themselves holding a big chunk of Strategy, making them an unwitting part of the Bitcoin story. It’s like they’re playing a game of “Hot Potato” with Bitcoin, but they can’t put it down. 🥔

The fact that Vanguard is now the largest shareholder of $MSTR is proof that God has a sense of humor, or at least that was my reaction to @VildanaHajric who wrote story about it out today

— Eric Balchunas (@EricBalchunas) July 14, 2025

Institutional Backing Signals Shift

Michael Saylor sees this as a sign that institutions are coming around to Bitcoin. He told Bloomberg that Vanguard’s stake is “a powerful signal” of acceptance. For years, many big firms treated Bitcoin as a niche asset. Now they’re tied to its fortunes through Strategy’s public shares. That shift may encourage others to take a closer look. It’s like Bitcoin is finally getting the prom date it’s been waiting for. 🎉

Bloomberg analyst Eric Balchunas summed up the irony on X, saying “God has a sense of humor.” He pointed out that Vanguard’s index approach means it must own all the stocks in its benchmarks—whether it likes them or not. It’s like being forced to eat your vegetables, even if you don’t want to. 🥦

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2025-07-16 03:19